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A report released last night by Democratic staff on a Senate investigations committee presents documentary evidence that the Bush administration was made aware of illegal oil sales and kickbacks paid to the Saddam Hussein regime but did nothing to stop them.

The scale of the shipments involved dwarfs those previously alleged by the Senate committee against UN staff and European politicians like the British MP, George Galloway, and the former French minister, Charles Pasqua.

In fact, the Senate report found that US oil purchases accounted for 52% of the kickbacks paid to the regime in return for sales of cheap oil - more than the rest of the world put together.

"The United States was not only aware of Iraqi oil sales which violated UN sanctions and provided the bulk of the illicit money Saddam Hussein obtained from circumventing UN sanctions," the report said. "On occasion, the United States actually facilitated the illicit oil sales.[...]

Yesterday's report makes two principal allegations against the Bush administration. Firstly, it found the US treasury failed to take action against a Texas oil company, Bayoil, which facilitated payment of "at least $37m in illegal surcharges to the Hussein regime".

The surcharges were a violation of the UN Oil For Food programme, by which Iraq was allowed to sell heavily discounted oil to raise money for food and humanitarian supplies. However, Saddam was allowed to choose which companies were given the highly lucrative oil contracts. Between September 2000 and September 2002 (when the practice was stopped) the regime demanded kickbacks of 10 to 30 US cents a barrel in return for oil allocations.

In its second main finding, the report said the US military and the state department gave a tacit green light for shipments of nearly 8m barrels of oil bought by Jordan, a vital American ally, entirely outside the UN-monitored Oil For Food system. Jordan was permitted to buy some oil directly under strict conditions but these purchases appeared to be under the counter.

The report details a series of efforts by UN monitors to obtain information about Bayoil's oil shipments in 2001 and 2002, and the lack of help provided by the US treasury. /td>

THE PRESIDENT: Chief weapons inspector, Charles Duelfer, has now issued a comprehensive report that confirms the earlier conclusion of David Kay that Iraq did not have the weapons that our intelligence believed were there.

The Duelfer report also raises important new information about Saddam Hussein's defiance of the world and his intent and capability to develop weapons. The Duelfer report showed that Saddam was systematically gaming the system, using the U.N. oil-for-food program to try to influence countries and companies in an effort to undermine sanctions. He was doing so with the intent of restarting his weapons program, once the world looked away.